European Central Bank Publishes First SEPA Migration Report and Warns Against Risks of Late Migration.

On 21 March 2013 the European Central Bank (ECB) has published its first report on the migration towards the Single Euro Payments Area (
) (see 'related links' below). It describes the state of play of the migration process in euro area countries towards the creation of a single market for credit transfers and direct debits in euro across Europe, and provides guidance on the management of the transition process.

In February 2012, the European Union (
) legislator adopted the 'Regulation (
) No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro' (the
Regulation), which defines 1 February 2014 as the deadline in the euro area for compliance with the core provisions of this Regulation. Effectively, this means that as of this date, existing national euro credit transfer and direct debit schemes will be replaced by
Credit Transfer and
Direct Debit.

According to the ECB press release of 21 March 2013 (see 'related links' below), its first
Migration Report "shows that most corporations have already completed the planning phase and know what
will mean for them in practical terms. However, when it comes to the actual implementation, a number of companies have adopted very late internal deadlines, even as far as to the end of 2013. This is a source of concern in particular when it comes to the migration to the
direct debit scheme. More worryingly, Small and Medium Enterprises' (SMEs) and local public administrations' awareness of
is still fragmented and the level of preparedness is rather poor."

The ECB press release also states: "Late migration is highly undesirable in projects like
, where many technical details need to be reflected in end-users' back-office systems and internal processes. In some cases, companies could even face the risk of some level of disruption in their handling of payment orders." Therefore, the Eurosystem, which comprises the ECB and the national central banks of countries which have adopted the euro, "strongly advocates that all stakeholders, including 'big billers', public administrations and SMEs, migrate at the earliest stage possible, preferably by the third quarter of 2013 at the latest, in order to avoid risks which could impact the wider supply chain and would put the
migration at risk."

"Adapting to
involves adjusting a lot of technical and business procedures over a limited period of time. Projects of this kind should not be left to the last moment," said Benoît Cœuré, Member of the Executive Board of the ECB. "I hope that all stakeholders will take migration to
payment instruments as a top priority."

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